Bridger v. Goldsmith

• Decision Date: 30 October 1894
• Citation: 38 N.E. 458,143 N.Y. 424
• Parties: BRIDGER v. GOLDSMITH.
• Court: New York Court of Appeals Court of Appeals

143 N.Y. 424

38 N.E. 458

BRIDGER

v.GOLDSMITH.

Court of Appeals of New York.

Oct. 30, 1894.

Appeal from common pleas of New York city and county, general term.

Action by Henry J. Bridger against Jonas G. Goldsmith. From a judgment at general term (23 N. Y. Supp. 9) affirming a judgment for plaintiff, defendant appeals. Affirmed.

Isaac H. Maynard, for appellant.

John A. Straley, for respondent.

O'BRIEN, J.

The judgment in this case awards equitable relief to the plaintiff, rescinding and declaring void for fraud a written contract made by the parties on the 16th day of March, 1891. By this contract the defendant sold to the plaintiff, for $3,000, his business, fixtures, and other property, including three upright pianos in his store or place of business in the city of New York. The plaintiff went into the possession of the store and the goods, having paid $2,500 of the purchase price, and soon after ascertained that he had been induced to enter into the contract and make the payment by means of grossly false and fraudulent representations as to the character and value of the property, and the extent and magnitude of the business, which the defendant transferred to him, and the income therefrom. The fraudulent acts and representations of the defendant which induced the plaintiff to purchase and pay for the property are fully alleged in the complaint, and found by the referee upon evidence entirely sufficient. In view of these findings we must assume, upon the consideration of the appeal, that the defendant, in negotiating the sale, deceived and defrauded the plaintiff. The judgment annulled the contract, and directed the defendant to restore to the plaintiff the portion of the purchase price which was paid. In this state of the case there would be no question for our consideration, except for a peculiar clause which was inserted in the written instrument, which is the evidence of the terms and conditions of the sale, at the request and upon the suggestion of the defendant. That clause reads as follows: ‘It is exprelly understood and agreed between the parties hereto that the said party of the first part has not, in any manner or form, stated, made, or represented to the said party of the second part, for the purpose of inducing the sale of the said business or the making of this agreement, any statements or representations, verbally or in writing, in any respect to the said business, other than that the said party of the first part has been engaged in the piano business in the city of New York since 1867.’

It is urged by the learned counsel for the defendant that, as this stipulation was inserted in the writing, which is under seal, and assented to by both parties, the action cannot be maintained. I assume that the fact that a seal was unnecessarily affixed to an agreement for the sale of personal property cannot affect the rights of the parties. Every defense is open to either party that would have existed in case the writing was unsealed. It appears that after the negotiations had been completed, and the agreement drawn, the defendant stated, in the presence of the plaintiff, and the counsel for both parties present, that he wanted a clause of this character inserted. The plaintiff's counsel at first objected to it. The defendant's counsel suggested that it would make no difference, and the plaintiff consented that it might be put in. There is evidence in the case tending to show that the plaintiff voluntarily assented to this stipulation, after having been advised by his counsel that it would have the effect of precluding him from subsequently alleging fraud in the transaction, even though it existed in fact. This provision is not a ‘covenant,’ in any proper sense of that term. Indeed, it can scarcely be considered as any part of the agreement at all. It does not relate in any manner to the subject-matter of the contract. It was a mere statement in the nature of a certificate as to a fact. It did not relate to the property, or to the terms of the sale, or the payments, but to the absence of all fraud from the transaction. The clause cannot be given any greater effect than if it had been written upon a separate paper after the execution of the contract, and signed by the parties. The question now is whether it can be given the effect claimed for it by the learned counsel for the defendant,-to preclude the plaintiff from alleging fraud in the sale, and pursuing in the courts the remedies which the law gives in such cases. It cannot operate by way of estoppel, for the obvious reason that the statements were false to the defendant's knowledge. He may, indeed, have relied upon its force and efficacy to protect him from the consequences of his own fraud, but he certainly could not have...